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Settlement of Certain Stockholder Litigation

As previously disclosed, on August4, 2015, IPC Healthcare, Inc., a Delaware corporation (the Company or IPC), entered into an Agreement and Plan of Merger (the Merger Agreement) with Team Health Holdings, Inc., a Delaware corporation (Team Health), together with Intrepid Merger Sub, Inc. (Merger Sub), a Delaware corporation and a direct, wholly-owned subsidiary of Team Health, providing for, subject to the satisfaction or waiver of specified conditions, the acquisition of the Company by Team Health at a price of $80.25 per share in cash pursuant to a merger (the Merger) of Merger Sub with and into the Company.

As previously disclosed, two purported stockholders of IPC each filed a putative class action complaint in the Delaware Court of Chancery on behalf of a purported class of stockholders naming IPC, each of IPCs current directors, Team Health and Merger Sub as defendants (the Defendants). By order of the court, these actions were consolidated (and are collectively referred to as the Litigation), and all further litigation relating to or arising out of the merger was directed to be consolidated with such actions. A third action was filed in the Delaware Court of Chancery and, pursuant to order of the court, is required to be consolidated with the previously-filed actions.

On November6, 2015, the Defendants entered into a Memorandum of Understanding with the plaintiffs in the Litigation providing for the settlement and the release of all claims that were or could have been brought against the Defendants in the Litigation based upon a duty arising under Delaware law to disclose or not omit material information in connection with the Merger, upon entry of a final order by the Delaware Court of Chancery approving the settlement. In the Memorandum of Understanding, IPC agreed to file a Form 8-K making certain supplemental disclosures to the definitive proxy statement of IPC on Schedule 14A dated October15, 2015 relating to the Merger and the Merger Agreement (the Proxy Statement).

The Defendants believe that no additional disclosure is required to supplement the Proxy Statement under applicable laws. However, to avoid the risk that the Litigation may delay or otherwise adversely affect the consummation of the Merger, and to minimize the expense of defending the Litigation, IPC has agreed, pursuant to the terms of the Memorandum of Understanding, to make certain supplemental disclosures to the Proxy Statement. The supplemental disclosures to the Proxy Statement are set forth below. The Memorandum of Understanding contemplates that, subject to completion of certain confirmatory discovery by counsel to the plaintiffs, the parties will enter into a stipulation of settlement. The settlement contemplated by the parties will be subject to customary conditions, including consummation of the Merger, certification of the class alleged in the Litigation, and court approval following notice to IPCs stockholders. In the event that the parties enter into a stipulation of settlement, a hearing will be scheduled at which the Delaware Court of Chancery will consider the fairness, reasonableness, and adequacy of the settlement. If the settlement is finally approved by the presiding court, such settlement will resolve and release all claims that were or could have been brought against the Defendants based upon a duty arising under Delaware law to disclose or not omit material information (including a claim for negligent misrepresentation) in connection with the Merger, pursuant to terms that will be disclosed to stockholders of IPC prior to final approval of the settlement. There can be no assurance that the parties will ultimately enter into a stipulation of settlement or that the Delaware Court of Chancery will approve the settlement even if the parties were to enter into such a stipulation. If the Delaware Court of Chancery does not approve the settlement, such proposed settlement, as contemplated by the Memorandum of Understanding, may be terminated.

Supplements to the Proxy Statement

The following disclosure supplements page 34 of the Proxy Statement in the section entitled The MergerBackground of the Merger by adding the following immediately following the second full paragraph on such page:

In April 2015, our board engaged Evercore to provide financial advisory services in connection with a potential acquisition by IPC. Pursuant to that engagement, the board shared information with Evercore regarding IPCs financial situation, strategy, and projected growth. However, this potential acquisition was not consummated.

The following disclosure supplements and restates the second full paragraph on page 35 of the Proxy Statement in the section entitled The MergerBackground of the Merger:

During the weeks of June22 and June29, representatives from Credit Suisse, at the request of our board, contacted nine (9)additional prospective strategic parties in the healthcare industry (including Team Health, Party C, Party D, Party E and another company in the healthcare industry (which we refer to as Party F)) on behalf of IPC to discuss a potential acquisition. Of these nine (9)additional prospective parties, six (6)expressed interest in obtaining further information regarding IPC and four (4)of these parties (Team Health, Party C, Party E and Party F) ultimately entered into nondisclosure and standstill agreements with IPC. On July2, 2015, Team Health and IPC entered into the nondisclosure and standstill agreement. None of these nondisclosure and standstill agreements prohibit the counterparty from privately (and not publicly) submitting to the Company a proposal to acquire IPC following the execution by IPC of a definitive merger agreement with a third party. The four parties that entered into nondisclosure and standstill agreements were sent Confidential Information Presentations and commenced diligence relating to the potential acquisition. Over the next several weeks each of the six (6)parties (with the exception of Team Health) that had expressed interest in IPC ultimately indicated to Credit Suisse that, for a variety of reasons, they did not intend to submit a letter of interest and were not prepared to move forward with the process to acquire IPC.

The following disclosure supplements and restates the first full paragraph on page 37 of the Proxy Statement in the section entitled The MergerBackground of the Merger:

From the outset of the Boards consideration of potential business combinations, the Board had contemplated that it might engage an additional investment bank to render an opinion with respect to a potential transaction once such a transaction appeared sufficiently likely. Although Credit Suisse had previously provided capital markets and other investment banking services to Team Health for which it had received aggregate fees, discounts and commissions of less than $100,000 since January1, 2013, the Board noted that it did not consider those services to be material and did not believe that they impaired Credit Suisses ability to provide the Board with objective advice with respect to a potential transaction. During the weeks of July20 and July27, Evercore performed preliminary work in preparation for potentially rendering a fairness opinion. On the morning of July31, 2015, our board held a special telephonic meeting at which representatives of Credit Suisse and Evercore were present. Pursuant to the Cooper Recusal, Dr.Cooper was not present for this meeting. The board then...